TO:Andrew P. Powers, City Manager
FROM:Ingrid Hardy, Assistant City Manager
DATE:December 5, 2023
SUBJECT: Community Grants Program Update
RECOMMENDATION:
1. Approve one-time additional budget appropriation and expenditure in the amount of $75,000 from A/C #001-0000-311-1000 (General Fund – Fund Balance) to A/C #001-1120-611-5920 (SS2025, General Fund – Grants & Donations).
2. Approve one-time reallocation of $25,000 from the Community Sports Grant program A/C #001-1120-611-5920 (SF2024, General Fund – Grants & Donations) to the Community Social Services Grant program A/C #001-1120-611-5920 (SS2025, General Fund – Grants & Donations).
3. Adopt resolution for Community Funding Review Committee and rescind Resolution 2021-047.
4. Find that this action is not a project as defined under the California Environmental Quality Act.
FINANCIAL IMPACT:
$75,000 Increase to Adopted FY 2024-25 General Fund Budget. $75,000 increase to the Adopted FY 2024-25 General Fund Budget is requested to provide additional funds to better meet the need of the Community Social Services Grant Program (SS2025).
BACKGROUND:
In 1985, City Council set aside funds to “provide a benefit for the community through competitive grants to individuals and organizations for services, construction or improvement of facilities, or promotion of the City…”. These competitive grants have supported community organizations seeking funding for
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4 art and cultural events, environmental projects, facility enhancements and equipment for sports teams, and social services programs.
Although the community grants program was originally established in 1985, the endowment fund reserve to support the Events, Sports, and Social Services grants was not formally established until FY 1999-00. The initial endowment allocation of $6.0 million was increased to $8.0 million in FY 2010-11 to offset declining interest earnings. In FY 1998-99, $2.0 million was set aside in a separate Community Cleanup Endowment Fund to help fund community environmental projects.
While this method of funding has largely been successful over the years, it has not functioned equivalent to a traditional endowment. Endowments are typically restricted with some percentage of the funds held in reserve and grant funds adjusted annually to allow for fluctuations in interest earnings. However, each grant program has continued to award the same annual allocation. Since the programs were established, none of the four grants has been funded solely through interest earnings. The annual interest shortfalls for the Environmental grants have been supplemented with support from the Solid Waste Fund. The annual interest shortfalls for the Events, Sports, and Social Services have been supplemented with support from the General Fund.
In 2018, the City Council established the Community Funding Review Committee (CFRC) as a single committee to oversee the Community Grants Program. In 2021, the City amended the resolution to streamline grant procedures and changed the names of the grant programs, removing “endowment” and renaming the four grant programs as the Community Environmental Enhancement Grant (CEEG), Community Events Grant (CEG), Community Sports Grant (CSG), and Community Social Services Grant (CSSG).
DISCUSSION/ANALYSIS:
Over the most recently funded five-year period (excludes years when grants were not provided due to the COVID-19 pandemic), the City has granted over $1.5 million to over 100 nonprofit organizations for Environmental Enhancement, Events, Sports, and Social Services. During this period, the City also provided three COVID-response grants: the Rental Assistance Program with $1,000,000 of funding, the Social Services Emergency Relief Program totaling $100,000, and the One-Time Social Services Grant with $965,000 of funding. The COVID-response grants are not included in this Community Grant Program evaluation.
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4 TABLE 1
* For CEG no awards were provided in FY 2020-21, FY 2021-22, and FY 2022-23 due to the COVID-19 pandemic. In the most recent funding cycle, FY 2023-24, the CEG funded 90.54 percent of eligible requests.
Table 1 provides a five-year summary of the Community Grants Program (excludes years when grants were not provided due to the COVID-19 pandemic).
During this period the City granted over 80 percent of all eligible requests for the CEEG and CSG, as well as for CEG in the post-COVID cycle. For CSSG, the eligible requests ($1,132,771) far exceeded the available budget ($500,000) for the five years in review. During FY 2023-24, the City received $267,805 in eligible CSSG requests. With a budget of $100,000, only 37 percent of eligible requests were awarded CSSG funds. This indicates a need in the community for social services and a potential gap in CSSG funding.
Proposed Resolution Changes
The current resolution criteria, procedures, and guidelines have been used for two years. Staff and the current CFRC determined that revisions to the guidelines should be made for clarification, to increase consistency, and to make the process more user-friendly for grantees.
Staff presented the proposed changes to the CFRC on November 15, 2023, to receive their feedback. The response to the changes from CFRC was overwhelmingly positive.
The most notable change in the proposed resolution (Attachment #1) is updating the funding criteria in Exhibit A of the resolution. Below is a summary of the proposed changes:
1. Identifies transportation and transportation-related activities as ineligible uses of grant funds.
2. Clarifies eligible uses for Environmental Enhancement grant funds.
3. Specifies that up to 20 percent of the grant award may be used for grant administration for the Environmental Enhancement Grant and the Events Grant
5-Year Period
Budget
Allocation
5-Year Period
Total Eligible
Requests
Amount Awarded
During 5-Year
Period
% of eligible
requests
awarded
during 5-Year
Period
CEEG $225,000.00 $250,788.71 $204,826.00 81.67%
CEG $500,000.00 $664,730.50 $431,495.50 64.91%*
CSG $500,000.00 $398,371.68 $384,949.16 96.63%
CSSG $500,000.00 $1,132,771.18 $500,000.00 44.14%
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4 Grant and that the Sports Grant is not eligible for grant administration.
4. Adjusts the Events Grant by reducing the amount held in reserve for unanticipated, off-cycle requests from 15% to 10% of the total annual Events grant funding allocation.
5. Updates the grant funding allocation per organization for the Social Services Grants.
6. Continues to provide the opportunity to establish specific criteria for future or one-time grants as needed.
Additional Funding Requested
To better meet the grant requests of the CSSG program, additional one-time funding of $75,000 is recommended, as well as a one-time reallocation of $25,000 from the undersubscribed CSG program to CSSG. The additional one-time funding would provide the needed resources for those organizations to continue providing essential public and social services in the community. Staff will continue to explore the possibility of a permanent funding adjustment and review the concept during the next budget cycle.
COUNCIL GOAL COMPLIANCE:
Meets the following City Council goals:
A. Create a more equitable, accessible, safe, welcoming, and inclusive government and community regardless of race, color, ethnicity, religion, sex, physical or mental ability, sexual orientation, gender identity and expression, age, language, education, and/or socio-economic status.
B. Provide municipal government leadership which is open and responsive to residents, and is characterized by ethical behavior, stability, promoting public trust, transparency, confidence in the future, and cooperative interaction among civic leaders, residents, business representatives, and staff, while recognizing and respecting legitimate differences of opinion on critical issues facing the City.
G. Continue City's commitment to community and cultural programs and services (such as Performing Arts/Theatres, Libraries, TOTV, Visual Arts, Youth and Senior Programs).
PREPARED BY: Sarah Mailes, Community Services Analyst
Attachments:
Attachment #1 – CFRC Resolution
CMO: 115-02\H:\COMMON\City Council\Council Items\2023 Staff Reports\120523\12052023 Community Grants Program Update.docx